Conclusion, Investment Implications, Strategy
Johnson & Johnson (JNJ) appears to be resuming its late March advance following the confirmation of a bullish chart pattern on April 6th. A sustained rise above the $142.32 area would help confirm this and target an additional 11% rise to $163.75 per share. This is an Asbury Momentum idea.
Analysis and Rationale
Johnson & Johnson (JNJ) researches and develops, manufactures, and sells various products in the health care field worldwide. It operates in three segments: Consumer, Pharmaceutical, and Medical Devices. The company markets its products to general public, and retail outlets and distributors, as well as distributes directly to wholesalers, hospitals, and health care professionals for prescription use. It has collaboration agreements with Morphic Therapeutic; and Emergent BioSolutions, Inc. The company was founded in 1886 and is based in New Brunswick, New Jersey.
Chart 1 below plots JNJ daily since Q4 2019 and shows that price is currently rebounding from a May 27th test of of its 50-day moving average, a widely-watched minor trend proxy currently situated at $142.32. Previously, a bullish chart pattern confirmed on April 6th targets an additional 11% rise to $163.75 per share.
Table 1 below shows that, considering the aforementioned upside target and a protective stop placed below the $143.01 area, a long entry price of $147.62 would provide a 1:3.5 risk/reward ratio (risking $1.00 to make $3.50) with an initial risk of 3.1%.
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